The impact of SEC regulation and the cryptographic bear market on Ethereum

As far back as June 2017, it was starting to seem inevitable l & # 39; exaggeration it would have occurred and Ethereum would have taken first place in the cryptocurrency market. With intelligent contracting capabilities and an order of magnitude of more potential applications than Bitcoin, everyone was eager to jump on the wagon of the Ethereum.

Of course, a lot has changed since then.

The bull race fueled by speculation that culminated in the historical highs of late 2017 for Bitcoin and January 2018 for the altcoins was unsustainable. To speak of a global paradigm shift appears ridiculously premature in hindsight.

Today, prices have plummeted across the market, with the same Ethereum breaking below $ 100 last December after the historic highs of $ 1.4k, just 11 months earlier. Although a mini-start has begun at the beginning of 2019, the situation continues to appear grim and the reputation of cryptocurrencies for the general public is still far from the stellar one.

Leading blockchain expert, Peter Du, the founder of Du Capital, recently explained the crux of the problem, saying:

"The cryptocurrencies, which once were the new treasure and the dream of investors, are now lagging behind, given the current crypt. Indeed, maintaining hundreds of billions of dollars in valuations backed by unprotected coin issuance was unrealistic and long-term unsustainable. Ethereum as an infrastructure blockchain on which other currencies have been imposed, has been a temporary beneficiary and has grown as a result of the evaluation, but without an equivalent growth in infrastructures, ecosystems and mass adoptable applications. "

To make matters worse in the short term, the US Securities and Exchange Commission (SEC) began breaking down on unregistered ICOs (initial offerings of coins). It seems likely that it will take hundreds and perhaps even thousands of projects to return money to investors. And this partly contributed to the massive sell-off of ETH during this bear market, as the vast majority of ICOs were on Ethereum and are now dumping what is left of their reserves in favor of the legal currency.

As Du went on to explain, however, perhaps the SEC regulation and the bear market experience will serve as a valuable lesson for investors and non-specialist builders in the blockchain industry.

"Now that the US Securities & Exchange Commission has issued more stringent regulation on ICOs, somewhat rediscussed assessments have returned to Earth. The inability to scale out of Ethereum has a huge cost, not only for its project, but also for token owners and other tokens that rely on it. We also see it with other infrastructure coins, like EOS. In the medium term, they risk marginalization, as the new public and sector blockchains increase their position. Not everything is sad and, if anything, we must learn from this. At the end of the day, the most demanding investors should worry less about short-term speculation and more on the solidification of long-term constituent elements to make the blockchain a formidable and reliable ecosystem."

Not surprisingly, there have been some growing pains in these early years, since major changes never happen without a hitch. What we will ultimately contend when it comes to the general framework of cryptocurrencies is a potential redefinition of money and, consequently, the greatest transfer of wealth that humanity has ever seen.

This possibility is what has attracted many overzealous speculators in the 2017 market, but it can also be what attracts many more innovators and builders to contribute significantly to the ecosystem in the future. In fact, 2018 showed significant growth in measures other than price, such as the development of new decentralized applications.

Ethereum is already used as a basis to support all kinds of promising and potentially world-changing applications, from decentralized forecasting markets like Augur to security token platforms like Polymath and Swarm.

The CEO of the Ethularum SingularityNET project, dr. Ben Goertzel, recently appeared on one of the biggest podcasts in the world, Joe Rogan Experience, and discussed the intersection of artificial intelligence and blockchain, explaining how Ethereum and SingularityNET allow AIs to send data, processing tasks and transactions between of them.

All this is only scratching the surface of what the Ethereum ecosystem can eventually understand in the years to come. At the moment, however, it seems only a distant dream.

The bear market and the repressions of the SEC have ushered in a very bitter cryptic winter and ended thousand of projects. Whether this winter is followed or not by a beautiful spring, only time will tell.

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and / or its affiliates, employees, writers and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own in-depth research before investing in any cryptocurrency and read our full disclaimer.